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«13TH INTERNATIONAL PUBLIC RELATIONS RESEARCH CONFERENCE “Ethical Issues for Public Relations Practice in a Multicultural World” Holiday Inn ...»

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Van Leeuwen, B. (2008). On the affective ambivalence of living with cultural diversity. Ethnicities, 8(2), 147-176. doi:10.1177/1468796808088921 Walton, R. (2008, January 20). Evaluating the youth work ethic. Tulsa World, p. E1. Retrieved from http://www.tulsaworld.com/business/article.aspx?subjectid=46&articleid=20080119_5_E1_s panc81715&archive=yes Weston, M. J. (2006). Integrating generational perspectives in nursing. OJIN: The Online Journal of Issues in Nursing, 11(2), 1-8. Retrieved from http://www.nursingworld.org/ 247

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If there are any decisions you have made that you are uncomfortable with, feel free to use the space below to provide a description. Your answers are confidential.

2. Please provide the one answer that would most closely match your response to the following hypothetical situation.

A birth control pill for men has been developed. A pharmaceutical company has paid your agency to coordinate interviews with Rachel Kelly, a doctor. Rachel is receiving payment from the pharmaceutical company for her media appearances. Your boss asks you to pitch Rachel’s appearance to local media throughout the United States. Your boss says that you are not to reveal that Rachel is being sponsored by a pharmaceutical company. Your boss explains that it doesn’t matter anyway because the birth control pill has been thoroughly tested for safety, and your boss shows you ample evidence. Your boss just wants to ensure that the media treat Rachel as a health expert rather than as a corporate spokesperson. What do you do?

a. Pitch Rachel’s appearance. When media ask about the sponsor, say that you are doing this to promote Rachel’s stature as a national expert.

b. Pitch Rachel’s appearance. When the media ask about the sponsor, ignore your boss’ instructions and reveal the pharmaceutical sponsor.

c. Explain to your boss that you do not feel comfortable with this assignment. (The last person who challenged the boss was let go three months later.) d. Refer this situation to someone about your level in your workplace. Ask for help.

e. Skip this survey question.

3. Please provide the one answer that would most closely match your response to the following hypothetical situation.

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your client. She says the agency would greatly appreciate the help, and it would be a wonderful personal favor to her as well. She did this for her boss when she was an account coordinator, which helped her get quickly promoted. What do you do?

a. Volunteer to ask either question.

b. Volunteer to ask the easy question of the agency’s candidate.

c. Stay quiet and let someone else volunteer.

d. Skip this survey question.

4. Please provide the one answer that would most closely match your response to the following hypothetical situation.

Jaime is an influential vice president in your agency, and she has national recognition. You have wanted to make a good impression on her; however, you have not had the opportunity for much interaction. She approaches you with a special assignment. Jaime asks you if you would feel comfortable monitoring an activist group by attending its meetings and pretending to be a volunteer.

She says that you in no way need to accept the assignment if you don’t feel comfortable. You realize that if you turn this assignment down, she will ask your co-worker, Catherine. What do you do?

a. Accept Jaime’s assignment.

b. Politely decline Jaime’s assignment.

c. Skip this survey question.

Feel free to use this comment area for the questions on this page.

(Questions 2, 3, and 4 appeared on the page.)

5. Please indicate the one best answer.

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6. If internal politics play a role, do they guide you toward more ethical or less ethical decisions a. More ethical b. Less ethical c. Internal politics do not play a role d. Skip this survey question.

7. Please indicate the one best answer.

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extent does the need to keep your job affect the ethical decisions you make?

8. If the need to keep your job plays a role, does this desire guide you toward more ethical or less ethical decisions?

a. More ethical b. Less ethical c. The need to keep my job does not play a role d. Skip this survey question.

9. Please indicate the one best answer.

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10. If your desire to get ahead plays a role, does this desire guide you toward more ethical or less ethical decisions?

e. More ethical f. Less ethical g. The desire to get ahead does not play a role h. Skip this survey question.

11. We would like to find out how helpful the following questions are for deciding whether a decision is ethical. Please indicate how practical these questions would be for ethical decisions you might encounter.

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Should everyone else who is in a similar situation do the same thing I am about to do?

Am I proceeding with good intentions?

Will the dignity and respect I have for myself and others be compromised by this decision?

12. Please indicate how helpful your education and the PRSA code of ethics are in making ethical decisions.





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Abstract

The concept of corporate social responsibility (CSR) is intrinsically linked to both ethics and the practice of public relations. While past research has shown us that it is no longer a question as to whether or not a corporation should be socially responsible, but is a requirement of organizations by consumers, modern research has yet to conclusively show that organizational involvement in socially responsible activities positively affects financial performance. This study extended the existing body of literature related to CSR and financial performance with the inclusion of consumers’ perspectives.

In combination with Ajzen and Fishbein’s Theory of Reasoned Action model for predicting behavior, this study used interviews and surveys of consumers to show that a positive relationship exists between CSR and financial performance or that consumers are more likely to purchase a product if they perceive the company that makes it as socially responsible. Additionally, comparisons were made among populations within the study based on demographic data, resulting in conclusions about those populations that are more likely to purchase products based on CSR activities. Some qualitative data was also included in order to further explicate consumers’ understanding of CSR in general as well as in regards to specific organizational involvement in socially responsible activities.

253

Introduction

Modern corporate social responsibility (CSR) has many names, such as corporate citizenship, corporate philanthropy, corporate giving, corporate community involvement, community relations, community affairs, community development, corporate responsibility, global citizenship and corporate social marketing. Likewise, the definition of CSR changes from researcher to researcher.

For example, CSR can be generally defined as the organization incurring responsibilities to society beyond profit maximization. (Pava and Krausz 1995, 1) A more specific definition of CSR is offered by Business for Social Responsibility: “operating a business in a manner that meets or exceeds the ethical, legal, commercial, and public expectations that society has of business” (Kotler and Lee 2005, 3).

Purchase intention can most readily be understood as the likelihood that a consumer intends to purchase a product. The concept of purchase intention is rooted in psychological and behavioral studies; therefore, the theory of reasoned action works well for identifying and understanding associations between CSR and purchase intentions for this study. Armitage and Christian (2004) explained that the theory of reasoned action holds that “behavior is solely dependent on personal agency (i.e., the formation of an intention), and that control over behavior (e.g., personal resources or environmental determinants of behavior) is relatively unimportant” (p. 6). In other words, the theory of reasoned action was designed to deal with relatively simple behaviors in which the prediction of behavior required only the formation of an intention.

Although the core of CSR is concerned with responsibilities beyond profit maximization, the relationship between an organization’s involvement in socially responsible practices and its effects on the financial performance of organizations have yet to be conclusively determined. It is important to recognize the relationship between consumers’ purchase intentions and organizations’ involvement in socially responsible programs because often CSR is dismissed as merely another public relations tool. However, understanding the underlying reasons consumers make purchases in relation to CSR would contribute to the understanding of CSR as a strategic management function overall. Furthermore, the literature addressing CSR in relation to an organization’s financial performance is conflicting; however, the majority of literature recognizes that a positive association exists between CSR and organizations’ financial performance. Auger et al. (2007) posited that, “The literature on the importance of social product attributes is much less developed than the branding literature. Most research, both commercial and academic, on the importance of these attributes suggests that a growing number of consumers are taking ethical and social issues into account when purchasing products” (p. 2). To put this in numbers form, Harrison (2003) found that, “By 1996, 67 percent of adults were claiming to consider a company’s ethical stance when buying a product and 55 percent would not deal with a company if they disliked its ethics” (p. 129). More importantly, however, Harrison (2003) cited that in 2001, 80 percent of consumers surveyed in the UK believed that companies should attach at least as much importance to social responsibility as profitability when making business decisions. (p. 129) Despite evidence that consumers appear to feel so strongly about organizational involvement in socially responsible programs, Abouzeid and Weaver (1978) determined that social responsibility was not a dominant goal in any of the 220 companies they studied.

Therefore, this study sought to go straight to the source of an organization’s financial performance, the consumer. Most indicative of the need for this study, Thompson (1995) stated that, “…knowledge about marketing ethics has increased substantially over the last several years, in large part because of the many empirical studies that have been conducted. However, the majority of this research has analyzed the ethical judgments of marketing professionals—consumers’ considerations of ethical issues has been neglected” (Creyer and Ross 1997, 422).

254

Corporate Social Responsibility and Financial Performance

Much of the research regarding CSR has focused on the financial aspects of the topic.

McGuire et al. (1988) offered an excellent overview of the dilemma encountered when examining the relationship between CSR and financial performance: “One view is that firms face a trade-off between social responsibility and their financial performance. Those holding this view propose that firms incur costs from socially responsible actions that put them at an economic disadvantage compared to other, less responsible firms” (p.854). Thus, many organizations see involvement in socially responsible activities as a negative association.

Contrary to this viewpoint, McGuire et al. suggested the alternative view that the cost of CSR is minimal and that firms may actually benefit. Likewise, in interviews with corporate executives, Holmes (1976) found that, “A significant change in executive opinions and corporate philosophies of social responsibility has occurred over the past five-year period. Executives anticipated more positive than negative outcomes from the social efforts of their firms, and almost all executives believed that corporate reputation and goodwill would be enhanced through social endeavors” (p.

40). Therefore, CSR and financial performance was viewed by many organizations as having a positive association.

A third and final perspective suggested by McGuire et al. stated that no association could be seen between CSR and financial performance or “that the costs of socially responsible actions are significant but are offset by a reduction in other firm costs” (854). The relationship between CSR and financial performance is controversial; however, the majority of research and studies have revealed a positive association between CSR and financial performance. For example, Pava and Krausz (1995) analyzed 21 noteworthy studies related to CSR and financial performance. Their results indicated that of the 21 studies analyzed, the majority revealed a positive association, and more studies revealed that no association existed than that a negative association existed.

Numerous similar studies using content analyses methodology to show a positive association between CSR and financial performance have been done. Bragdon and Marlin (1975) conducted one of the earliest studies of CSR as it relates to financial performance studies. The researchers used measures of financial accounting in comparison to levels of pollution to show that lower levels of pollution had a positive association with better financial performance. Belkaoui (1976) also used pollution as a CSR topic of choice to show that stock returns were higher for firms that disclosed pollution control information in annual reports than for a control sample. In addition, Cotrill (1990) used Fortune magazine’s annual survey of corporate reputations in comparison to market share.



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